Renault is to be the next manufacturer to declare that it will withdraw from Formula 1 if the FIA does change the rules as voted by the FIA world council on April 29th.

Following on from Toyota on Sunday and Ferrari yesterday, the French manufacturer will argue that the two tier system and the budget cap are not the basis for a sport in which it wishes to participate. BMW are expected to follow shortly.

I would not expect Mercedes to take their place in this queue, as they are more likely to keep their heads down after the recent disciplinary events in which they were involved with McLaren.

What is significant is that the manufacturers are not simply saying, “Ditch the budget cap and the two tier system or we are off.”

They are looking to go further than this and use this opportunity to question the FIA’s system of governance. Sorting out the budget cap and two tier system would be relatively straight forward once all parties agreed to talk. However the wider issue of governance is more thorny.

The manufacurers are also very concerned that the public should not get the impression that FIA president Max Mosley is the only one who is trying to cut costs in F1. They argue that many teams would not even be racing this year if the FOTA cost cuts to testing and engine use had not been agreed in December. They want to go further, but they want to be in charge of deciding how far and how quickly. And they want to keep the vital idea of technology and research, which carries across into their road cars.

Mosley’s point is that there is no time for that. The economic crisis is the trigger for all of this. He accepts that FOTA has tried to cut costs, but has two fundamental problems with their approach; the FOTA measures don’t cut costs by enough and they focus on restricting technology, rather than encouraging innovation under a ‘same for everyone’ budget cap. He sees an opportunity to redraw F1 into something more sustainable and useful.

Both sides have a point. It’s an ideological struggle which goes to the heart of what F1 stands for.

The key question here is, “Who’s benefit is this for?”

One of the key points Mosley makes is that he wants new teams to come in. The problem with the way this is evolving is that at some point the question is going to be asked whether bringing in new teams like Lola and I Sport is worth sacrificing Ferrari and the manufacturers for.

It is also worth noting that many of the independent teams who favour the budget cap, such as Williams, Force India and Brawn are currently dependent on the manufacturers for an engine.

Cosworth is on standby to provide engines should they be needed, but it is a few years since they were involved in Formula 1.

Also important to remember that at the moment Fiat (Ferrari) is the only car company that is out there buying up other car companies ..... so it may well be that it is not just Ferrari's participation/engines that are in doubt .... let alone the other manufacturers siding with Ferrari.

It beggars belief that the teams keep on faffing around year after mired year with the FIA, Max and Bernie. Much better to cut their ties and to let FOTA find a way to run things.

No system of management will be perfect, but the rubbish we've had in recent years means it is time to move on. The credit crunch is the prefect time to chew Max and Bernie up and to spit them out.

I agree with you James in that it is an ideological struggle with the question of - who benefits?

The problem is that is it should be the consumer who benefits through the implementation of innovation in the cars manufacturers build, innovation that comes from Formula 1.

I think everyone would agree that it is the two tier system that is the problem (as well as trying to lay off so many people) but I think the only natural conclusion to this current path by the FIA is the loss of the major manufacturers, but they will re-enter in a number of years because they see the innovation in technology drying up.

Problem is, it's a major step for F1 to take - to lose the major manufacturers, something's got to give and you just get the feeling that whoever Bernie sides with will end up the winner

"the FOTA measures don’t cut costs by enough and they focus on restricting technology"

Another example of how Mr Mosley is out of touch - anyone working in industry will tell you than in times of economic crisis the first thing that gets cut is the budget for training, followed by research and then staff. So in that light it is obvious that FOTA - as a first and urgent measure last December - would start by cutting the money spent on any new technology!

This is not the time to be spending millions on things like KERS, windtunnels and brand new cars and aero packages - this is the time to consolidate what you have, keep things ticking on, with a sensible and regular set of rules.

Lets not forget FOTA speaks for ALL the teams, and if any of the current teams is in difficulty they will no doubt help each other out or cut costs even further. Brawn GP is ultimate proof that they intend the sport not only to continue operating and providing a world class spectacle, but that they are also willing to improve it and give new teams a decent chance to go racing.

It's also the time when those that have made billions out of F1 (i.e. Bernie) put their hand in their pockets and foot the bill - which I also believe is happening.

The last thing needed here is for the FIA to stick the elephant into the china shop...

The first step to cutting costs should be getting rid of the curse of Formula One, KERS. After tens of millions of pounds spent, the KERS equipped cars are still slower round the circuit than the cars unencumbered by this wretched and completely unnecessary trick power power-plant. Moreover they spoil the racing by acting as mobile chicanes and threaten to hold up pole-sitters from the start.

I seem to remember that the great Colin Chapman's design philosophy was to "add lightness and simplicate". This is precisely the opposite of the effect of putting KERS on a racing car. The KERS system also introduces additional hazards when the car crashes (not an infrequent occurrence in F1) hazards which will hardly be lessened in cars carrying 40 gallons of highly inflammable fuel next year.

Surely the essence of a racing car is a stripped-down machine designed with one aim in mind, speed. To load such a machine with exorbitantly expensive and utterly superfluous machinery is a complete nonsense when you're trying to rid the sport of its overspending ways in a recession.

Glad to see the teams standing up for themselves. With Red Bull also threatening to withdraw that leaves 4 teams (McLaren, Williams, Brawn and Force India - a very British grid) for next year, with however many newcomers.

I think Mosley is hoping for a return to the 20th century model of manufacturers as engine suppliers, perhaps with a collaboration with a team (but no more than Williams-Renault had in the 1990s). I'd be happy with that, but I don't think that is what is going to happen.

These withdrawal threats/promises are putting Williams and Brawn in a bind - they only exist for F1 racing. Can FOTA persuade them to come along?

I don't think Formula 1 needs the manufacturers. The sport was popular before the manufactuerers joined. Remember the early 90s when teams like Williams, Benetton, Jordan, McLaren (without Mercedes) and even Arrows won races? Toyota have been in the sport for years and I don't think they have contributed anything -- the same goes for BMW.

Ferrari are perhaps a separate issue, but what about turning the question on its head? Would Ferrari's brand be as strong without F1?

The only sensible way forward is a budget cap, therefore inspiring the cleverest solutions to problems rather than the most expensive. We are in a serious global economic recession and the manufacturers want to spend MORE than 40 million a season? Crazy. I say good riddance to the car makers and lets bring F1 back to its roots of innovation, competition and great racing.After all, if Renault, BMW, Ferrari etc do leave F1, think of all those skilled people needing a job, and going straight to Lola,iSport, and ForceIndia! Make no mistake, F1 will outlive any individual team, as it has proven over the past 60 years.

Max Mosley knows that he has a short-shelf life for his plan and as the global economy improves a large part of his justification for the budget cap will increasingly be eroded.

I don't think there is any reason for fans of the manufacturer F1 teams to be too concerned here. These organisations do not plough vast sums of money into the sport on a whim. Neither will they sacrifice the global brand development opportunities that operating at the very pinnacle of motorsport represents. The name may possibly change from F1 and the nuclear option would probably see the manufacturer backed teams split away from FOM and FIA but there will always be a race series that is recognised as the pinnacle of motorsport and the key places in that series will always belong to the global automotive manufacturers.

I am a little surprised that nobody else has mentioned it but Max Mosley appears to be trying to apply a communist socioeconomic structure to F1 right now whereby teams like Force India and Torro Rosso get to operate in a classless, egalitarian series where everyone is equal. The only difference being that all participants swear their allegiance to FIA rather than Marxism or Leninism.

I hope the manufacturers will dig their heels in and react swiftly and decisively on this but I fear that if economic indicators continue to suggest a recovery then they may choose to apply delaying tactics, safe in the knowledge that the FIA's justification for the cap will lose momentum.

The last few years, since Micheal Schumacher retired, things have gone down and down. There's been horrendous stuff with Maclaren, Alonso, Mosely's sexual preferrences, Maclaren again. And now the budget cap. We don't have to watch F1. It isn't compulsory. It is, in the end, a sport. We are interested in F1. But if things carry on like this for much longer the whole thing wil be fit only for fans of I'm a celabrity - - - - - - -

I am truly amazed how many people are clearly missing the point, this is all smoke and mirrors from Max and Bernie, designed to split up the teams, bully, confuse and weaken their resolve before bumrushing them into another agreement to, yet again, take 50% of F1's income for themselves.

With Max and Bernie out of the picture there is no need for costcutting.

Max's grand idea for 2009, KERS, has been the biggest waste of 100's of millions since, ever. Why has he not apologised for this crass debacle ? Any honourable man would have resigned by now after presiding over such a disaster. Why is everybody, journalists included, too scared to question this ?

Has Max effectively forced McLaren's silence with some nasty threat ? How strange that they do not feel free to add some comments or input to the discussion ? James even goes so far as to subtly suggest this but for some reason does not come out with a full on accusation of what would, if proved to be true, be a very serious matter.

We need to be rid of these 2 greedy bullies ASAP for the sake of F1, let alone everybody's sanity.

I believe F1 can be made cheaper for independent teams and at the same time a technology showcase for the manufacturers by keeping things simple like:

1. The FIA should implement standardized floors, diffusers and wings-technology which really does not apply to road-cars.

2. Standardize the brakes in order to ensure that outbraking an opponent will not be impossible.

3. Regulate engines only as to maximum displacement and the type of materials that could be used to build such engines.

4. Re-introduce active suspension as this technology will be relevant for modern road cars.

5. development should be on the mechanical side of the car and not the aerodynamic side, which is a very big cost in todays racing.

All mechanical parts made by the manufacturers should be made available for a per season lease to any independent team who wishes to use it. This must be a package of engine, gearbox and suspension components. The price of this lease per season must be fixed by the FIA.

This way all teams will build a car around a floor and wings designed by the FIA. Use an engine and suspension package of a participating manufacturer at a fixed cost per season, wherein the engine, suspension and other mechanical components must be exactly the same as what the manufacturer's team, if any, is using.

This would be better than max's plan of standardizing the engine or this budget cap rule, and easier to police too.

Reading between the lines: Moseley's gameplan is not a two-tier formula. The technical freedom if you come under a cap suggestion is nothing more than an ingenious/underhand way of forcing the bigger teams to 'voluntarily' sign up to the budget cap. £40m is an opening gambit by Moseley, and he's expecting the teams to revert with a larger figure. So far so typical of Moseley.

But any sort of budget cap is distinctly unpalatable to some of the more significant players: Ferrari, in particular (and McLaren too if were not sufficiently cowed by Moseley to keep their heads under the parapet). Everyone, even Ferrari included, can undoubtedly see the sense in reducing costs and keeping the playing field relatively level.

A huge amount of the profit generated by F1 (TV and live spectators) does not come back to the competitors. It must really grate on the teams to be told that money is scarce and they must allow forensic accountants to scrutinise their balance sheets, when FOM (still an emanation of Bernie?) takes a huge amount of the profits (50%?).

So three suggestions:(1) Bernie et al. release more money to the competitors;(2) For non-engine manufacturers, engines are paid for out of revenue money at a fixed rate.(3) Thereafter, revenue money is uniformly distributed among the competitors (or at least more uniformly distributed)

The total annual profit generated by F1 is, I understand, in the region of $1billion, of which currently c. $500m is distributed among the competitors pro rata the order in which they finish the championship. Is there any compelling reason why say $750m should not be distributed among the competitors?

Say, Ferrari, Renault, BMW, Mercedes, Toyota decide to continue manufacturing engines. They would receive an extra $10m per team which they supplied paid out of the total revenue. The remaining $700m would be distributed equally - approx. $35m per team. Here is an instant effective budget of $45m for any smaller team. The same calculation with $500m rather than $750m, gives an effective budget of $37.5m. Even a small team should be able to drum up some sponsorship over and above that.

Can you imagine Manchester United saying they're going to form a break away league because they don't like the rules in the English Premier League? It's a bit ridiculous.

I think it's a simple equation. None of the teams actually want to leave F1. They're just playing hardball. I'm sure this will all be sorted out soon.

As for people who are against KERS, I understand the financial burden, but in reality it's one of the only things making the racing exciting right now. The cars still aren't capable to racing right next to each other without it. Standardised KERS is the suitable answer for next season.

I do really want to see the budgets cut. I realise this will cut jobs, but hopefully a lot of these people will be able to gain employment with new teams entering F1.

One thing that would interest me to know is what the drivers think of all this.

I agree with Oliver, F1 needs a bigger grid, so needs to reduce the cost, and needs to promote innovation to create, exploit new technology, these aspects are are not always compatible and in most respects diametric opposites.

So it is how and where to strike a balance.

To those that say Ferrari should be allowed to spend whatever it likes, I'd say particularly in a recession, you cannot allow the market to regulate itself, market forces, that will encourage either a two tier champs of 4 teams and continue a second division of also rans that fail, which wasn't two bad when Colin Chapman, Frank Williams or pre Dennis McLaren would sell you last years car and you could run out of industrial unit with 20-30 staff, that not a way to go on now you need a staff 300-400 and a huge capital investment. Newt result the grid will collapse over time to 12-14 cars.

Okay lets talk about a break away series. This is the worry for both F1 and GP1, it will turn in Indycar of the mid 90's which had become a credible international rival to F1, with an international profile (Mansell, Zanardi, Montoya, etc) based mainly in N American. Think of Ferrari as the Indy 500, and FIA as CART and the small racing teams, after 10 years of competition, they were both struggling financially and for grids, and both have had to save costs from smaller pot of revenue. It could have gone either way, but CART has folded, and when the war was over, IRL has won, but it is still severely damaged and a back water left as a one make series, to still trying and keep the costs down.

Thats the danger. Feel sure the manufacturers know it too, this is still just negotiation by media.

Two tribes two tiers two budgets two prizes perhaps.Two menTwo egosToo much.

Max now cannot win whatever he does, he will either raise the budget cap and loose the new entrants or loose the car manufacturers.

I still don't understand how Max can change the rules without the TWG or the SWG and the vote of the F1 Commision.

Ferrari have a ready made alternative series which will allow innovation, as do McLaren, and it is more directly related to their business than F1. It is not dominated by the FIA. It just needs the tv coverage. It is also well known in the USA.

Step 1: Ferrari will announce they will be entering the 'World Sports Car Championship' (and mean it).Reasons - Firstly this will give strength to there arguments and threatened departure. Secondly, it will allow them to utilise there present staff and redundant facilities.

Step 2: Ferrari will withdraw there threat when the financial cap is raised, and it is agreed nobody will look at their books.

Step 3: They and the FIA will withdraw any threats of legal action re the breaking of existing contracts.

A 'win/win' solution for Ferrari - Not only will they be able to compete in F1 for less, they will have the added exposure in the 'WSCC' and possibly the 'American LeMans Series', but more important they will be able to utilise the aero and mechanical developments of the sports car programme in conjunction with there F1 programme, with all the costs going.............you've guessed it.

In a way the economic crisis is a blessing because it finally brings Max head to head with the teams. Which has been needed for a long time.

The problem with Max is that he is not accountable. If the team bosses or drivers good a good or bad job, they will eventually punished (for cheating for example) or made to leave or retire from their team. Max is in a position where can do practically whatever he wants,[ moderated ]

He has always used safety and costs as his two reasons for pushing things through, even if the real reason was something else. How much does it cost to change rules every season? KERS is the latest example but it's been going on for years.

This latest issue of caps, gives the teams an excuse to target his "governance of the sport" by how he is trying to rush and force it on them. Bringing new teams to F1 is one issue but what about the teams share of money? That's something that not even James is talking about, but is very relevant bubbling under the surface of this latest "war".

Most people here seem to think that Formula 1 is all about the manufacturers with the independents making up the numbers. But if you look back more than 10 years, it's only Ferrari (who of course started out as an independent team) and Renault who were there and have actually achieved anything since.Ferrari are being very selfish in leading this revolt. They're the only manufacturer making any money at the moment and don't seemed to have noticed that the rest of the industry is on it's knees or will be very shortly. Without Max's budget cuts, F1 could easily loose another couple of manufacturers and the smaller independents as well. That's almost half the current (small) grid. Anyone remember the 26-car grids of the past?There's an interesting Q&A with Tony Purnell on the Autosport website that explains better than I've seen anywhere else the reasoning behind the FIA's moves. FOTA's ideas are too little, too late. The world has changed.Let the manufacturers go - I won't miss them, especially Toyota and BMW, what a waste of space - and let the real racers back in. Let's get back to real innovation (the Renault turbo car, the Brabham fan car, the Tyrrell and Williams 6-wheelers, the Lotus double chassis) rather than the endless tinkering within tight rules which is actually much more expensive. That's what F1 used to be about and should be again.

I too believe that this is all political posturing, and am sure it will all get sorted out in time. The only problem is what about the new teams that want to enter next year, if the budget get moved too high as a compromise F1 will no longer be affordable for them. I don't know how long it takes to design and build a car but time is running out fast. Dave Richards has already been burned when the rules changed regarding customer cars and he lost the deposit paid to the FIA as well as set up cost. Do you think this could also be a ploy for the existing teams to prevent new teams entering the sport ? I have to say I would very much like to see 3 new teams next year, so we will have to wait and see what happens

Let's face it, the teams who are in favor of the budget cap right now - the "independents" - all had their individual opportunities to secure or at the very least stabilize their financial well being a couple of years ago - if only they had swallowed their pride and/or used their heads a little bit more.

Didn't Williams screw their relationship with BMW by giving them the "hands off! We're Williams! We know how to win." message when the automaker wanted to help out in chassis design back when they were title contenders? Williams instead formed the Senior Management Group (SMG), which didn't really improve things and further soured the relationship. If only Williams were a little bit more open at the time, they could have ended up with something similar to the relationship McLaren now enjoys with Mercedes thereby strengthening their financial position and having more resources available.

And I remember reading an article before of Eddie Jordan admitting the reason Jordan (now Force India) declined in competitiveness was because they got a tad bit carried away with their contention for the '99 title and thereby mismanaged their resources by throwing it all in '00-'01. Had they only been wiser.

As for Brawn GP, blame the marketing philosophy from the B.A.R./Honda days. All I remember was their sponsorless cars plastered with "Lucky Strike"/"My Earth Dreams" logos and a tiny "Ray Ban" on the sides. If only they went the more conventional/proven way then maybe Honda could have shared the burden and did not having to feel the pressure of spending hundreds of millions of their own money.

They brought this struggle upon themselves. So no point dragging others down to their current level(s).

You don't see the FA changing the rules of football as the FIA do with F1. Imagine if they suddenly said Man U could still spend what they wanted on transfers, but to make it fair the opposing teams had goals half the size and were allowed two goalkeepers.... else work in a budget cap to make it fairer for the less wealthy teams.

They would soon be off to start up that European league that keeps getting mentioned every few years. FOTA should just tell the FIA to stick it now and sort out their own series to replace what we once called F1.

This war all started when max said that f1 does not need Ferrari as soon as Ferrari said it will pull out of f1 this war is over. Who the hell is going to watch a form of f1 with all independents? The manufactures are in f1 because of ferrari not max mosley all ferrari have to do is set up the new f1 minus [mod] max mosely and the manufactures will follow.

This war is over bernie will do what ever Ferrari wants and max will be gone [mod]. Honestly how the hell is this [mod] still in power? Anyway he doesn't have any power anymore he will see what everyone knows ferrari ARE F1!

The budget cap is the only cost-cutting strategy which makes sense in the medium term. What is important is encouraging innovation. However - time has to be given for the big teams to get their costs down and a reasonable and acceptable limit on expenditure needs to be set.

The rules in F1 are all the wrong way round. They are gradually moving F1 towards a spec series by defining what certain parts of the car will look like, with the challenge being to refine these parts to work best with your car.

Surely rules based on outputs would be much better - the wake from the car in the windtunnel will be no more than X, rather than try to define rules for parts which someone somewhere will find a loophole to allow them to get round it.

Greater technical freedom should therefore be embraced.

A two tier F1 would be ridiculous, artificial, and the end of the genuine sporting aspect of F1. It would be like giving small football teams a smaller goal to defend.

The elephant in the room is, of course, how the rules are created and imposed on the sport. The budget cap proposals are deliberately provocative to drive the teams towards the position that Mosley has already decided is his fallback position. There must surely be a better, fairer way of setting the rules than this

I think Maxie and Bernie have bitten off more than they can chew this time, they have shot themselves in the foot, legs and head. I hope the teams will stick together now, and get rid of these mercenary maniacs for good. and then we can go back to enjoying F1 as it used to be, when speed and not money was king .... RANT OVER.

Richard: The spiralling costs of Formula One and the problems the FIA are now trying to solve were caused by the manufacturers. They entered F1 with massive budgets, recruited all the top staff and paid them maybe ten times what they were earning at the smaller teams. Huge R&D budgets and all the rest followed, and what you have left is a sport that is unsustainable in its cost.

No new manufacturer has entered F1 since 2002 and since then two have left. If anything the age of manufacturers is coming to an end - F1 needs to safeguard its future by attracting teams who are in it only for the racing, because they will ride out tough times like this rather than cutting and running when the shareholders say so.

It seems almost obvious that this will end up with a raised budget cap and one set of rules (hopefully the current set so, no rev limits, moveable wings etc.)Why can't the FIA/FOTA cut all the bravado and just get this, inevitable, solution agreed?!?With the areas that are excluded from the cap it still means teams with more funding can indulge where they like, and I'm sure with some clever accounting they won't have to lay off the numbers that are being banded around.

Plus, as a fan, I want to see the inovation back. For me, at least, part of the appeal of F1 is the tech. The sport should be the pinacle of motoring tech not a more expensive A1 series.

I agree that F1 needs new teams. I aslo think that the budget cap is the easy solution, not the right solution. Rather than lowering the bar to enable smaller independent teams into the series FOM and FIA should be pushing in the opposite direction; increasing the freedoms, encouraging innovation and enticing other manufacturers. Rather than placating teams like Force India they should be looking at how they could attract TATA. They should be looking at stategies that will bring in Chinese automakers and their sponsorship allies.

The problem is that this is hard work and will not yield immediate results. If they build the right model and it is seen to pay dividends for current manufacturer teams then others will follow.

I don't think Renault, BMW and Ferrari particuarly want to be racing in a series with Lola and Prodrive. Motorsport heritage they might have but they represent a dillution of presige and with it brand erosion.

I meant to add, that there is of course a power struggle going on, if Ferrari and the other manufacturers are certain that Max Mosley has over reached himself this time, and doesn't garner wider support, that damaged or more damaged goods, this may be there bid to grab more power than they want, simply because they can, a bid to topple, Mosley certainly, and perhaps the the FIA.

These are interesting times, but this is not about breaking away, and the reasons to reduce costs are sound, it all leads to a compromise, but maybe Ferrari are now also going for broke.

Daniel... BMW have been heavily involved in all aspects of motorsport from F1, Le Man right through to rally cars & bikes since the 1930's! Google / Wikipedia them! So although BMW haven't always been directly involved, BMW have always had an interest in F1.

And neither have the 90's teams like Life, AGS, Eurobrun, Moneytron, Coloni, Andrea Moda, Symtek, Rial, Fondmetal etc... - all of which added close to nothing to the sport other than inflating the grid.

The current set of F1 teams are probably the best we've ever had in terms of quality, professionalism and competitiveness - just check the grids for the last 2-3 season and see how close it has been.

The remit of the FIA doesn't (and shouldn't) include getting rid of manufacturers.

There was a time, not so long ago, when Bernie and Max were very pleased to get the manufacturers into FI - it was the future, as it had been the past (the garage guys like Williams only came along in the 70's - "works" use to mean "works").

Now that they won't accept being treated like schoolboys, they're not so welcome. But without them, there's no show. As you say, James, all the teams rely on "works" engines.

The fan is on, the solids are starting to escape. Can't wait to see what happens here.